Fitschen Says `Pride' in Banks Needed to Pace RegulationNicholas Comfort
Deutsche Bank AG co-Chief Executive Officer Juergen Fitschen said German lenders need to win the country’s “pride” as he lobbies policy makers to reconsider plans to subject banks to stricter regulation.
“We need to ask what we can do for Germans to be proud of the great cars and machines we build, while wanting a banking system everyone can take pride in,” Fitschen, who succeeds Andreas Schmitz as president of the BdB Association of German Banks lobby group today, told reporters in Berlin. “We shouldn’t pursue too many measures only to correct them later.”
Global banks are being ordered to comply with a growing number of rules as individual states each implement their own regulation to avoid a repeat of the taxpayer-funded bank rescues that followed the 2007 meltdown of the U.S. housing market. That disparate situation may limit the flow of capital and drive up borrowing costs, Fitschen said today.
The co-CEO of continental Europe’s biggest bank said that during his time at the BdB he’ll push to preserve the so-called universal banking model of retail- and investment-banking operations under one roof.
German Social Democrat Peer Steinbrueck, who will challenge Chancellor Angela Merkel in elections in September, has called for Deutsche Bank to protect taxpayers and depositors by creating a firebreak around its investment bank.
Separately, Fitschen said that Europe’s leaders must make clear to bank bond investors and depositors whether their funds will be taxed in case lenders need to be rescued.
European policy makers roiled markets last month by wiping out bank bondholders and imposing a levy on savings of more than 100,000 euros ($131,000) in their rescue of Cyprus.
While the island nation’s rescue probably won’t be a “blueprint” for future bailouts in Europe, the levying of deposits could drive depositors to accept lower interest rates on their savings at banks they deem more secure, Fitschen said.